British Airways News

American Merger Talks Heat Up
US Airways, which has is pursuing a reluctant American Airlines, has signed a nondisclosure agreement with American’s parent company, AMR, according to a memo US Airways’ CEO Doug Parker sent to employees.

The two airlines have agreed to exchange confidential information to work in good faith on evaluating a potential combination. Parker said that the NDA means only that the airlines have agreed to talk about the possibility of merging. AMR’s CEO Tom Horton initially resisted the idea of a merger.

AMR has also signed an NDA with British Airways, Alaska Airlines, Frontier Airlines, Jet Blue Airways and Virgin America. (Source: press reports).

International Air Traffic Continues to Grow at a Slower Pace
Global air traffic grew 3.4% in July 2012 over a year earlier, down from a growth rate of 6.3% in June and 6.5% for the first half of the year, according to the International Air Traffic Association.

It blamed the slowdown on a recent fall in business confidence in many economies. Airlines are responding to slower growth by holding capacity, which means planes are flying full—and profitably. Traffic is growing, but at a slower pace, said Tony Tyler, IATA’s director general and CEO. And he said that, combined with rising fuel prices, means a tough second half of the year. (Source: IATA press release).

FAA to Study Use of Handhelds on Planes
The Federal Aviation Administration FAA has created a committee to study the use of portable electronic devices on planes. Right now, the FAA leaves the decision of how passengers can use handhelds in flight up to airlines.

The FAA committee will be made up of representatives of aircraft manufacturers, mobile technology providers, airlines, including flight attendants and pilots, as well as airline passenger organizations. Passengers are increasingly interested in staying connected while in flight. This is an effort to learn if there are ways for more electronic devices to be used without interfering with the radio frequencies pilots use.

The group will look at a variety of issues, including how to test for safety. The group is not looking at whether or not to allow cell phone use while in flight. (Source: FAA press release).

Delta to Reduce Mileage Rewards for Some Unpublished Fares
Delta Air Lines is reducing mileage passengers can earn when they buy certain unpublished fares. These include group fares, consolidator fares, tour or group package fares and student fares.

Travelers flying using negotiated corporate, governments and sports fares will continue to get full mileage credit. Other airlines also limit or provide no mileage awards for some unpublished fares. (Source: news reports).

TSA Expands Pre Program to Phoenix Sky Harbor
The Transportation Security Administration has introduced its Pre program at the Phoenix Sky Harbor Airport, with US Airways as its partner.

Participants who are from certain airline frequent flyer programs or who participate in the U.S. Customs and Border Protection’s Trusted Traveler program provide biometric information about themselves and qualify for expedited screening.

The Pre is now available in 22 airports with partner carriers US Airways, Alaska Airlines, American Airlines, Delta Air Lines and United Airlines. (Source: TSA press release).

Airlines’ On-time Performance is Best in Two Years
U.S. airlines reported their best on time performance in two years in April, according to the Department of Transportation’s latest figures.

Just over 86% of flights arrived within 15 minutes of their scheduled arrival time, the best since November 2009. And, airlines are getting better at keeping track of your bags. April’s mishandled baggage report was down to 2.63 reports per 1,000 passengers from 3.3 in April 2011 and 3.09 in March 2012. Airlines also reported no tarmac delays of more than three hours on domestic flights or more than four hours on international flights. (Source: DOT press release).

U.S. Air Passenger Traffic Up Slightly
The number of passengers U.S. airlines carry continues to increase, according to the latest statistics from the Department of Transportation.

The first three months of 2012 continued the growth trend of 2011, when system and domestic load factors hit an all-time high. U.S. airlines carried 2.8% more passengers in the first quarter of 2012 than in the first quarter of 2011. That meant that overall, passenger numbers were up 1.4%. The March 2012 passenger total was 3.6% above March 2010. Delta Air Lines carried the most total passengers.

Southwest Airlines carried more domestic passengers. United Airlines, which merged with Continental Airlines, carried the most international passengers. (Source: DOT press release).

U.S. Air Capacity Dips
Airlines might be carrying more passengers, but they’re flying fewer seats as U.S. carriers continue to trim capacity. In March, domestic capacity decreased by .6%t and capacity system wide was down .3%.

This is an ongoing trend; in late June both Delta Air Liens and United Airlines reduced their total seats by about 1 percent, anticipating slackening demand after Labor Day. (Source: DOT press release, news reports).

Delta to Offer In-flight WiFi on Its International Fleet
Delta Air Lines, the airline that has more planes equipped with WiFi than any other domestically, said that it will start offering in in-flight Internet service on its long-haul international fleet in early 2013.

Once it completes installing WiFi on all of its international aircraft in 2015, it will have more than 1,000 planes with WiFi. Lufthansa now offers WiFi on some transatlantic flights; Virgin Atlantic is introducing it later this year. (Source: Delta, Lufthansa press releases, news reports).

Aviation Continues to Work on Bio fuel Development
KLM flew the longest commercial bio fuel flight ever to the Rio+20 sustainable development conference in Rio de Janeiro late last month. It’s part of an ongoing aviation industry effort to develop use of bio fuel.

Lufthansa just wound up a six-month trial in which it used a 50-50 blend of bio fuel and regular fuel on its planes. Air New Zealand has flown bio fuel test flights and is working on developing bio fuel production in New Zealand.

British Airways said it plans to use a fuel derived from waste by 2015, while Virgin Atlantic said it will use fuel derived from waste gases by 2014, cutting its carbon footprint by 50 percent.

European carriers, bio fuel producers and the EU commission last year signed a pact to produce 2 million tons of bio fuel by 2020. In the U.S.A., United Airlines, Boeing, Honeywell’s UOP, the Chicago Department of Aviation and the Clean Energy Trust have formed the Midwest Aviation Sustainable Bio fuels initiative. Its goal: to promote bio fuel development in a 12-state region. (Source: press releases)

Air Traffic Is Up and So Are Oil Prices
Air traffic continues to increase, says the International Air Transport Association, with passenger traffic up 8.2% in January, better than December, when severe weather in Europe and North America slowed the recovery. January´s air travel volumes were 18 percent higher compared to the low point reached in early 2009 and some 6% above the prerecession peak of early 2008.

The problem with this otherwise rosy picture? Oil prices. The industry´s current forecasts were based on $84 per barrel oil and that price is now up to more than $100, said Giovanni Bisignani, IATA´s director general and CEO. A $1 increase in the price of oil means the industry has to recover $1.6 billion in additional costs. Bottom line? It´s another challenging year for airlines. (Source: IATA press release).

Airlines Test the Waters With Fare Increase
Early last month, several carriers initiated fuel surcharges that ranged from $4 to $10, according to airfare comparison website FareCompare.com.

Except for some peak travel miscellaneous surcharges for popular travel periods, U.S. consumers haven´t seen domestic fuel surcharges since November 2008, according to Rick Seaney, FareCompare´s CEO. And airlines continue to try hiking fares. Late last month legacy carriers tried a $20 fare hike but ultimately cut that in half when low-cost carriers countered with a $10 fare hike. (Source: FareCompare.com).

American Fined for Charging Bumped Passengers a Fee
Read the fine print if you volunteer to give up your seat on an overbooked flight. The Federal Aviation Administration has fined American Airlines $90,000 for failing to disclose that vouchers given to passengers who voluntarily gave up their seats on oversold flights could be redeemed only after paying a ticketing fee of as much as $30.

Airlines have to look for volunteers before involuntarily bumping passengers, when the Department of Transportation requires the airlines to pay travelers cash in most cases. Ray LaHood, US Transportation secretary, said that if you give up your seat, you deserve full compensation—and not find out later that they have to pay $30 to use it. (Source: DOT press release).

Major Carriers Tout Service into Tokyo´s Haneda Airport
Carriers are adding flights to Tokyo´s Haneda Airport, located near Tokyo´s business center, even as they maintain service to the larger—and more distant—Narita. Delta Air Lines is now flying between Tokyo Haneda and Detroit and Los Angeles.

American Airlines has also begun flying nonstop between JFK and Haneda. The new service is a result of the Open Skies Agreement that the U.S. and Japan signed in October. U.S. carriers aren´t the only airlines flying into the more conveniently located Haneda; British Airways launched its new route to Haneda in Japan on Feb. 19. (Source: American, British Airways, Delta press releases).

The result was that the number of fulltime employees for passenger airlines increased .2%. It´s a major turnaround for the industry, which saw employee numbers drop for the 28 months up until November 2010, when there was no change. (Source: DOT press release).

Airfares Show Some Decreases
Domestic airfares are starting to dip. The average domestic fare fell to $428.29 in December from $525.63 in November according to airfare tracking company Topaz International’s national database. And the average fare for the fourth quarter was $497.69, down from 526.18 for the third quarter.

Airfares have been climbing steadily throughout the year, hitting a high of $633.44 in June and trending downward subsequently.(Source: Topaz International Monthly Airfare Index).

IATA Figures Show Air Travel Continues Decline The International Air Transport

Association (IATA) reported that international traffic dropped 4.6 percent in December from December 2007, but that the 4.6 percent decline was far less dramatic than cargo’s 22.6 drop from the previous December.

Year-end leisure travel booked in advance kept passenger numbers from falling as dramatically as cargo. Still, a 1.5 percent cutback in supply could not keep pace with falling demand. That meant planes weren’t quite as full. “Airlines are struggling to match capacity with fast-falling demand.

Until this comes into balance, even the sharp fall in fuel prices cannot save the industry from drowning in red ink,” said Giovanni Bisignani, IATA’s general director. He pointed out that premium travel—the profitable front of the plane–declined 11.5 percent in November. (Source: IATA press release).

Air France-KLM Invest in Alitalia
Air France-KLM is taking a 25 percent minority stake in Alitalia. The partnership will be based on a multi-hub strategy, adding Rome Fiumicino and Milan Malpensa to Paris Charles-de-Gaulle and Amsterdam Schiphol.

The airline said Alitalia’s acquisition for Air One has strengthened its position in the domestic market; the carriers say they will plan to create synergies using network optimization and revenue management. (Source: Air France-KLM press
release).

United, British Airways Keep Passengers Connected in the Air
Both United Airlines and British Airways are keeping their passengers connected in-flight on certain routes. United Airlines will begin offering in-flight internet service to customers on board its p.s. transcontinental service between New York and California starting in the second half of this year.

The service will be available in all classes for a flat $12.95 fee on all 13 of the Boeing 757s United flies between JFK and Los Angeles and San Francisco.

British Airways will launch text and mobile services on its all-business class service between London City Airport and JFK later this year.

Customers will be able to access the internet and send emails from laptops with GSM data cards as well as their mobile phones and PDAs. Voice service may be offered in the future, depending on customer demand and feedback. (Source: BA, United press releases).

California Fare Wares Mean Cheaper Flights
Southwest is expanding its California service, adding five new nonstops between San Francisco International Airport and John Wayne International Airport starting May 1 and kicking off the service with a $69 fare.

That followed Virgin America’s announcement that it was starting service between San Francisco and John Wayne International April 30 with a $59 introductory fare.

The airfare monitoring website FareCompare.com reported that American Airlines and United Airlines responded with $59 fares April 30 through June 10 and said that a year ago, the two were charging $125 for one-way fights. (Source: Southwest and Virgin America press releases, FareCompare.com blog).

JetBlue to Start Service Out of LAX to New York and Boston
JetBlue Airways will begin service out of Los Angeles International June 18. It is JetBlue’s third Los Angeles airport. It will offer two daily nonstops to New York’s JFK and two daily flights to Boston’s Logan International. (Source: Jet Blue press release).

Airlines continue to seek scale by working ever more closely together. The latest example of this is the business agreement between American Airlines, British Airways and Iberia. The airlines say the deal will give their customers more destinations to choose from while helping the airlines to save money and attract new customers, which in turn would ease the upward pressure on airfares due to rising fuel costs.

Fuel prices are dropping but continue to take their toll, as evidenced by the shutdown of the discount transatlantic carrier Zoom Airlines (Source: American, BA, Iberia press releases and Zoom website).

American, Delta Offer WiFi
In-flight Delta Air Lines made its´ announcement first but American Airlines was first out of the gate with in-flight WiFi. American now has inflight WiFi on its Boeing 767-200s flying between New York and San Francisco and Los Angeles.

The service costs $12.95 on flights of more than three hours; travelers simply turn on their WiFi enabled devices, including laptops, smart phones and PDAs, once they hit 10,00 feet and are connected to Aircell’s Gogo portal, the WiFi provider, where they sign up for the service. Delta, meanwhile, will offer WiFi on its domestic fleet of 330 mainline aircraft, also with Gogo, introducing it on its MD 88/99 aircraft this fall and rolling it out fleet wide in the first half of 2009. The service will cost $9.95 on flights or three hours or less and $12.95 on flights of three hours or more. (Source: American, Delta press releases).

TSA Lets You Leave Your Laptop in Some Bags
The Transportation Security Administration will now let you leave your laptop in its bag when you go through security as long as it meets new checkpoint friendly standards.

These bags should have a designated laptop-only section; they must completely unfold to lie flat on the X-ray belt; no metal snaps, zippers or buckles inside, underneath or on top of the laptop-only section; no pockets on the inside or outside of the laptop-only section and packed in the laptop-only section other than the computer itself.

The TSA worked with laptop bag manufacturers to come up with the new standards. (Source: TSA press release).

Airline Eliminates Life Jackets
Air Canada Jazz is eliminating life-jackets, calling them redundant since seats act as flotation devices. Transport Canada permits flotation devices, like the seats, instead of life jackets if the planes fly within 90 kilometers of shore.

The seat cushions lift off and have restraints on the bottom through which passengers can slip their arms through. There will be life jackets available for infants. The idea is to save on weight
and fuel. (Source: Travel Pulse Daily).

United Furloughs Flight Attendants, Tests Charging for Meals Over Atlantic
United Airlines is furloughing 1,500 flight attendants as a result of flight reductions it announced this summer. That is about 10 percent of its cabin workers and part of its efforts to cut 7,000 jobs by the end of 2009. It also began testing charging for in-flight meals over the Atlantic.

On transatlantic flights out of Dulles, it is testing selling Buy on Board options, including sandwiches, salads and snack boxes. It will evaluate results at year’s end. (Source: press reports, United press release).

Americans Divided on Inflight Cell Phone UseIn-flight wireless services could presage in-flight cell phone use. Americans are divided on whether or not passengers should be able to use their cell phones in-flight, according to a study by the Department of Transportation.

The younger you are, the more likely you are to favor it-almost half (47.7 percent) of 18- to 34-year-olds approved of the idea. Only a quarter of those over 65 favored the move; those between 35 and 64 almost evenly divided-40 percent say they should allowed, 46 percent said they should not and the rest aren’t sure. Source: DOT press release).

Year-over-year highlights show that the composite cost index was up 17.4 percent, compared to a 4.0 percent rise in the Consumer Price Index. The three largest cost components were fuel (25.5 percent), labor (23.8%) and transport-related expenses (14.7%). Some figures dropped; the average cost of employing a full-time equivalent worker dropped $248 to $72,301.

JetBlue Launches Chicago Service
JetBlue Airways is introducing service to Chicago January 4, starting with five daily flights to New York’s John F. Kennedy International and two daily flights to LA/Long Beach Airport. In other parts of the country, JetBlue continues to expand its service.

In New York, it will introduce two daily flights to Florida from Newburgh’s Stewart International Airport to Fort Lauderdale and Orlando starting December 19 and it will add a daily nonstop to West Palm Beach January 5 2007. In addition, it has just launched non-stop service between Columbus, Ohio, and JFK. (Source: JetBlue press releases)

Delta Introduces Lie-Flat Seats
Delta Air Lines is installing fully horizontal sleeper seats in its international business class service.

It will introduce Contour Premium Aircraft seating early in 2008 when it takes delivery of two new Boeing 777 Long Range aircraft.

Delta joins international carriers British Airways and Virgin Atlantic in offering lie-flat seats on transatlantic routes. American Airlines is upgrading its business class seats to recline to an almost-flat 171 degrees, just a few degrees shy of the full 180-degree recline. (Source: Delta press release)

Northwest Airlines Extends Boarding Pass Faxing Service
Northwest now allow customers to print their boarding passes at international fax machines after checking in for flights over the internet.

This is in response to the fact that many business travelers have a laptop but no printer with them on the road, meaning they can’t check in online because they can’t print out a boarding pass.

United Introduces Washington-Tokyo Service
United Airlines has introduced daily nonstop passenger service between Washington, D.C., and Tokyo, its first-ever Asia service from the nation’s capital.

This fall, United has increased its’ service out of Washington Dulles International Airport by 39 flights. (Source: United press release).

Airlines Open Interim Passenger Lounges in LAX International Terminal
First and business class passengers at Los Angeles International Airport, which is undergoing a $576 million renovation, can use interim premium class lounges in the Tom Bradley International Terminal.

The first class lounge is in the Bradley terminals’ mezzanine. The business class lounge is in a vacant ramp area opposite the terminal; passengers can use it by taking one of a continuing operating stream of buses serving the terminal.

The lounges will be in use until four new lounges open in May of 2007. (Source: Los Angeles World Airports press release).